New Government Pension Scheme - Is It Worth It?

DM7

I'm 41 and currently don't pay any money into a pension scheme, would it be worth my while staying in the new government scheme or put that money elsewhere - I'm paid about £1,300 a month and £750 goes on rent (which goes up by £25 every other year), so I'm likely to be homeless if I reach retirement age anyway!

DM

dunstonh

would it be worth my while staying in the new government scheme or put that money elsewhere

You dont get a choice. The state pension has no monetary value that you can take out.

antrobus

By "new government scheme" isn't the OP referring to the process of automatic enrolment into workplace pensions which started in October? Aren't they asking whether they should take part or opt out?

(I don't the answer because I'm not an actuary.)

dunstonh

I was reading it as the new single state pension. Not auto enrolment which is just a set of rules and not a Government pension scheme. However, you could be right and the OP is mixing up what type of pension it is.

If it is an employer provided occupational scheme then the employer does not have to offer the employer contribution as cash for those that choose not to join the scheme.

Lokolo

DM7 wrote: »

I'm 41 and currently don't pay any money into a pension scheme, would it be worth my while staying in the new government scheme or put that money elsewhere - I'm paid about £1,300 a month and £750 goes on rent (which goes up by £25 every other year), so I'm likely to be homeless if I reach retirement age anyway!

DM

So why don't you make a plan to make sure you aren't homeless?

And btw when you say "reach retirement age", in fact, its unlikely you will retire at all given you have made no effort to plan for it.

atush

You do need to plan for retrirement and that includes your housing. So get to it, and join a pension if the employer is paying in as well.

And given you are on just 15K a year, spending 9 of it on rent is too much. Look for a cheaper place to live, share, whatever.

DM7

Thanks for the concern about my housing but as I live in the most fantastic place, I shall just have to see how it goes, better in my mind to live here as long as I can and take the grotty option later rather than sooner if I have to. I doubt I could have ever afforded enough to pay rent on any property on retirement though.

I did have a private pension scheme when I 18 but I couldn't keep up the payments. It is only now in my life that I actually have a small amount I could try to do something with.

I shall go away and do some more research on this pension scheme so I can explain it better, maybe I am using the wrong words to describe it.

I thank you all for responding though it is very much appreciated; sorry I couldn't be clearer.

DM